Rogers Sugar plans $200M facility expansion for Montreal

Key Takeaways:

• Rogers Sugar plans to embark on a $200M expansion of its Montreal plant. 
• This will increase its capacity by roughly 20%
• Work includes adding new equipment, building a new bulk rail loading section, and expanding logistics and storage capacity. 

The Whole Story:

Quebec is about to get a lot sweeter. 

Rogers Sugar announced it will increase the production capacity of its Montreal plant by approximately 20%, or 100,000 metric tonnes. The total investment for this project is estimated at approximately $200 million, and includes investments in sugar refining technology and equipment, as well as logistical infrastructure at Lantic’s Montreal sugar refinery and in the Greater Toronto Area to serve the Ontario market. 

The Montreal component will take advantage of available space in the existing refinery buildings and site, allowing production to continue with minimal disruption. By using existing facilities, Rogers aims to minimize construction impacts to the surrounding community.

“This project is good for our customers, our shareholders and our communities, as we add

production to serve rising demand, invest in Canadian manufacturing and create jobs,” said Mike Walton, resident and CEO of Rogers Sugar and Lantic. “Our sugar volumes are steadily increasing, and these investments will enable us to serve future demand growth, support the domestic food-processing industry and improve efficiency within our operations.”

The project is made up of three key components:

• Expansion of refining capacity with the addition of new sugar refining equipment at the Montreal plant.
• Construction of a new bulk rail loading section in Montreal to serve increased shipments to the Ontario market.
• Expansion of logistics and storage capacity in the GTA.

The company noted that the demand for industrial high-quality, reliable bulk sugar has steadily increased over the last few years, especially in Eastern Canada where the food-processing industry is expanding. 

The growth in demand is directly associated with an increase in the production of sugar containing products in the food manufacturing sector. Rogers stated that investment will support such growth and further position the company to serve those food-processing customers and to benefit from additional long-term demand for bulk sugar.

Over the last few years, the demand for Canada’s refined sugar has steadily increased in Eastern Canada to meet growing production of sugar-containing food products for Canadian and export markets. The company currently meets the increasing demand of the industrial market by transporting bulk sugar produced at its Vancouver plant to its eastern-based customers. By expanding refining capacity closer to its customer base, Rogers says it will reduce freight costs, drive improved margins, and leave more Western Canadian capacity available for alternative sales opportunities, including export outside of Canada.

The company expects the incremental production and logistic capacity to be in service in approximately two years. The financing plan will include funding from debt and equity or equity like instruments sources. The project is expected to receive support from the Quebec Government in the form of loans from Investissement Quebec to the Company’s operating subsidiary, Lantic, for up to $65 million.